He has also missed out relative to the index because he does not hold consumer discretionary stocks such as Tencent and Naspars, which have performed strongly this year.
Speaking on a client webcast last week, Mr Forey admitted that the performance on his fund had been “disappointing”.
The manager said July and August had been particularly tough months for the fund, when it was severely hit by falls in its Indian holdings.
Mr Forey explained the stocks for the most part had performed well in local currency terms, especially as the Indian stockmarket recently hit an all-time high.
However, that has coincided with a massive fall in value for the Indian rupee against sterling, which has resulted in big losses on the stocks when calculated in pounds.
The fund is in the third quartile of the IMA Global Emerging Markets sector for performance in the past year, while it has also underperformed the MSCI Emerging Markets index in the same period, according to data from FE Analytics.
In addition to the struggles in India, Mr Forey admitted “two or three” of his South African stocks had “detracted quite meaningfully” from fund performance.
However, he is standing his ground on the fund, happy that he still has “a lot” in India and South Africa, and has not made many changes recently.
He said one sector in which he was currently looking for stocks was industrials, where he would like to own more companies if he could find good ones, but he had yet to do so.
Following more than three years’ of underperformance from emerging markets compared to developed markets, Mr Forey identified two main themes that would have the most impact on returns in 2014.
The first was the impact of the US Federal Reserve reducing, or tapering, the size of its bond-buying programme, known as quantitative easing, which he said will primarily affect currencies in emerging markets.
Mr Forey said those countries that are reliant on foreign capital to fund their own deficits, such as Turkey, will struggle when the US reduces quantitative easing, while those with a budget surplus or high cash reserves, such as Taiwan, will not be.
Some people have suggested emerging markets could see a repeat of the crisis of the 1990s, but Mr Forey insisted there would not be a rerun of that, although tapering will provide a “headwind” to returns.
The second theme is profit growth from emerging market companies, which is an area in which emerging companies have struggled versus developed market companies in recent years.
However, Mr Forey said the big reasons for the struggle were now largely played out and he said he was “reasonably optimistic about profit growth from emerging market companies”.
He said returns from emerging markets will be driven by profit growth and dividend growth, two areas in which emerging markets have outperformed developed markets significantly when looking at the past decade, according to Mr Forey.
Growing pains
JPMorgan Asset Management’s Austin Forey (pictured) is not the only manager who has suffered from underperformance relative to the index and peers due to his exposure to India.
Many of the managers who focus largely or exclusively on bottom-up stockpicking and long-term opportunities from emerging market companies have run with high weightings in Indian stocks this year.
This includes giants of the Asia Pacific sector such as the First State Asia Pacific Leaders fund and the Aberdeen Asia Pacific fund, both of which are among the best in the sector in the long run but have dropped to the bottom quartile in the past year.
India has suffered a huge drop in its growth rate in recent years, from 9 per cent in 2011 to 4.4 per cent in the past financial year.
This decline in economic growth has been exacerbated by fairly high indebtedness from the government and high inflation of roughly 10 per cent.
With an election planned for May next year, there are some hopes that reforms might be enacted, while there have been some better than expected data points recently, including GDP growth of 4.8 per cent in the third quarter.
If the improving economic data leads to a rally in the Indian rupee and the stockmarket, the likes of JPMAM, First State and Aberdeen could be set to recover in 2014.
